Question
Peruna Car Wash (a publicly traded car wash chain) is expected to grow at various rates over the next five years. The companys current free
Peruna Car Wash (a publicly traded car wash chain) is expected to grow at various rates over the next five years. The companys current free cash flow (FCF) is $140 million. The company expects to grow at 15% for the next two years. For years three to five, the company expects to grow at 10%. After the first five years of non-constant growth, the company expects to grow at a constant rate of 5% per year indefinitely. Peruna Car Wash has $500 million debt outstanding, $350 million in cash, and 125 million shares outstanding. Assuming the cost of capital at Peruna is 11%, what is Peruna Car Washs share price? Do NOT round to less than two decimal places in the intermediate steps. Round your final answer to two decimal places. Show work on paper (no excel)
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